What is Arbitrage?

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Arbitrage

Richard Gere starred in the movie Arbitrage. It is one hell of a movie, a great thriller, it is all about money and about high finance, a Vanity Fair story come to life.

But what is Arbitrage? According to investopedia:  “The simultaneous purchase and sale of an asset in order to profit from a difference in the price. It is a trade that profits by exploiting price differences of identical or similar financial instruments, on different markets or in ...

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The language of futures trading: Contango vs Backwardation

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The language of futures trading:  Contango vs Backwardation

The language used in trading futures can sometimes be daunting.  We learn this jargon first at university, then we come across media commentary with similar words that may mean nothing and for most people it may sound like double Dutch.

So what on earth is contando and backwardation?  A market is said to be in contando when the forward price of a futures contract is above the expected future spot price. Normal ...

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Markets that make up the financial system (part 2)

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Markets that make up the financial system (part 2)

In editorial 1, I wrote: A financial system includes three very important pieces in the “puzzle”.  …….. The system includes a range of financial institutions, a range of financial instruments and various markets that allow the free flow of funds.

In editorial 2, I covered the various financial institutions categories.

In editorial 3, I covered the range of financial instruments.

In editorial 4, I covered how markets make up the financial system (to ...

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What are financial instruments?

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Markets that make up the financial system

In editorial 1, I wrote: A financial system includes three very important pieces in the “puzzle”.  …….. The system includes a range of financial institutions, a range of financial instruments and various markets that allow the free flow of funds.

In editorial 2, I covered the various financial institutions categories.

In editorial 3 yesterday, I covered the range of financial instruments.

In this editorial, I will cover the markets that make up the financial ...

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What are financial instruments?

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What are financial instruments?

In editorial 1, I wrote: A financial system includes three very important pieces in the “puzzle”.  …….. The system includes a range of financial institutions, a range of financial instruments and various markets that allow the free flow of funds.

In editorial 2 yesterday, I covered the various financial institutions categories. In this editorial, I will cover the range of financial instruments.

A financial instrument is a document that can be placed as an asset on the ...

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What makes our financial System robust?

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What makes our financial System robust?

Yesterday I wrote: A financial system includes three very important pieces in the “puzzle”.  …….. The system includes a range of financial institutions, a range of financial instruments and various markets that allow the free flow of funds.

What type of financial institutions do we have here in Australia?  Not just banks!

Most people have conducted business one way or another with a bank mainly. There is a wide range of financial institutions operating ...

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Is our financial system robust?

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Is our financial system robust?

A financial system includes three very important pieces in the “puzzle”. Most people don’t know enough about why we need a financial system that is regulated and what makes a comprehensive system that ensures that the growth of an economy is sustained.

The system includes a range of financial institutions, a range of financial instruments and various markets that allow the free flow of funds.

Overseeing that the system works efficiently and without any corruptions ...

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